Tags: Companies | Hide | Food | Costs | Selling | Smaller | Packages

Companies Hide Higher Food Costs by Selling Smaller Packages

Wednesday, 30 Mar 2011 09:05 AM

Food prices are rising, and food companies are concealing price increases by selling smaller amounts for the same amount of money.
Consumers themselves are noticing they're buying less food for the same prices.

"Whole wheat pasta had gone from 16 ounces to 13.25 ounces," Lisa Stauber, a mother of nine in Houston, tells The New York Times.

"I bought the same amount I always buy, I just didn’t realize it, because who reads the sizes all the time?"

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Food packages shrink as prices rise.
Companies historically slash their product sizes amid economic downturns, today via coy marketing campaigns such as "greener" packages, which are actually smaller.

"Consumers are generally more sensitive to changes in prices than to changes in quantity," says John T. Gourville, a marketing professor at Harvard Business School.

"And companies try to do it in such a way that you don’t notice, maybe keeping the height and width the same, but changing the depth so the silhouette of the package on the shelf looks the same. Or sometimes they add more air to the chips bag or a scoop in the bottom of the peanut butter jar so it looks the same size."

A can of Chicken of the Sea albacore tuna now comes in 5-ounce packages instead of the 6-ounce versions, and in some cases, the 5-ounce can costs more, according to the Times.

High food prices are also helping to dampen overall consumer sentiment.

The Conference Board reports that its consumer confidence index fell to 63.4 percent in March from 70.4 percent in February.

"Consumers' inflation expectations rose significantly in March and their income expectations soured," says the Conference Board's research Director Lynn Franco, according to the AFP newswire.

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Food prices are rising, and food companies are concealing price increases by selling smaller amounts for the same amount of money. Consumers themselves are noticing they're buying less food for the same prices. Whole wheat pasta had gone from 16 ounces to 13.25 ounces, ...
Companies,Hide,Food,Costs,Selling,Smaller,Packages,us,economy
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2011-05-30
Wednesday, 30 Mar 2011 09:05 AM
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